Posts in Valuation

Chancery Addresses Valuation Issues Arising From LLC Member’s Withdrawal

Smith v. Promontory Financial Group, LLC, C.A. No. 11255-VCG (Del. Ch. April 30, 2019).

In the limited liability company context, LLC agreements sometimes provide for a buyout of a member deciding to withdraw its investment.  Coming in many forms, such provisions give rise to potential valuation issues.  This decision arises in that setting.

In a decision driven by unique facts, the Court of Chancery relied upon the plaintiff's proposed valuation from an unconsummated deal to value a professional services company with “erratic and sparse” cash flows. The Court concluded that the company’s business model rendered both an asset accumulation method and a discounted cash flow method inappropriate. More ›

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Court Of Chancery Explains Difficult Valuation Techniques

In Re Appraisal Of DFC Global Corp., Consol. C.A. 10107-CB (July 8, 2016)

This decision deals with the always difficult world of what beta to use in a DCF valuation.  The Court’s analysis is an exhaustive review of the alternative approaches and is particularly helpful in valuing a publicly traded company in some financial turmoil.

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